Gov. Pat McCrory used the audit as an opportunity to hammer home his pledge to fix the government. His office also released a statement highlighting the appointment of a new director for the Medicaid program, Carol Steckel, who is described in the news release as “a nationally recognized expert in Medicaid.”

Steckel has her work cut out. Wood’s audit paints a picture of an agency, the Division of Medical Assistance, run by incompetents.

Some of the problems Wood found can be attributed to the complexity of the Medicaid program and the fact that more than one agency spends Medicaid money. But there is no excuse for an agency responsible for millions of taxpayer dollars to have had no system for tracking where money was going, or that contractor payments far exceeded budgeted funds.

According to the audit, Medicaid overspent by more than $1.4 billion during each of the most recent three fiscal years. In many cases, the cost overruns were traced to excessive payments to contractors who provide service to the state’s 1.5 billion Medicaid clients. The system for detecting fraud also is woefully deficient.

Administrative costs are much higher than other states, which one might think would improve oversight. Not so. Much of the additional cost, about $180 million more than comparative states, is because so many different agencies are involved with Medicaid clients and because payments to contractors count as administrative costs. The rest? Let’s just say the taxpayers aren’t getting their money’s worth.

Gov. Pat McCrory used the audit as an opportunity to hammer home his pledge to fix the government. His office also released a statement highlighting the appointment of a new director for the Medicaid program, Carol Steckel, who is described in the news release as “a nationally recognized expert in Medicaid.”

Steckel has her work cut out. Wood’s audit paints a picture of an agency, the Division of Medical Assistance, run by incompetents.

Some of the problems Wood found can be attributed to the complexity of the Medicaid program and the fact that more than one agency spends Medicaid money. But there is no excuse for an agency responsible for millions of taxpayer dollars to have had no system for tracking where money was going, or that contractor payments far exceeded budgeted funds.

According to the audit, Medicaid overspent by more than $1.4 billion during each of the most recent three fiscal years. In many cases, the cost overruns were traced to excessive payments to contractors who provide service to the state’s 1.5 billion Medicaid clients. The system for detecting fraud also is woefully deficient.

Administrative costs are much higher than other states, which one might think would improve oversight. Not so. Much of the additional cost, about $180 million more than comparative states, is because so many different agencies are involved with Medicaid clients and because payments to contractors count as administrative costs. The rest? Let’s just say the taxpayers aren’t getting their money’s worth.

The division also ignored a state mandate to repay money owed to the federal government. Instead, it continued to carry over the $131 million debt, ostensibly because the “legislative leadership” said it was OK.

It’s not OK, and McCrory and his team are charged with overhauling this apparent mess of an agency.

This is not the first time we’ve heard about sloppy oversight and overpayments. Through a contract with IBM, the state has found tens of millions of dollars in fraudulent payments to providers, some of whom have been bilking the taxpayers for years. Even further back, during Mike Easley’s administration, an audit uncovered $400 million in overpayments to providers who billed the state for basic personal services performed by low-wage employees at a rate more consistent with highly paid health care officials.

McCrory’s new Medicaid administrator comes to her job with strong recommendations. Her task is to whip the Medicaid division into shape, so that it can better serve both the taxpayers and the elderly, poor and disabled clients who depend on the program.